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- reducing risk of relying on only one or few income source
- avoid cyclical or seasonal fluctuation by producing goods or services with different demand
- achieving a higher growth rate
Wiki User
∙ 13y ago
Wiki User
∙ 14y agoIt isn't necessarily important to diversify.
If you want high risk and high reward then you do not want to diversify. Take a look in Forbes and see how many people got there by being diversified. The answer of course is none of them.
If you are looking for wealth preservation then you might want to diversify. Generally, the more places you wealth is stored the lower the risk of large losses.
Wiki User
∙ 13y agoAdd your answer:
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Why are African countries diversify their economies?
African countries are finding that a diversified economy helps weather the highs and lows. It also helps in the case of crop failures from disease or bad weather.
Why are most economies referred to as mixed economies?
poverty is always higest in countries with market economies
How might the countries studied in this section improve their economies?
By not having a government based on Religion has improved their economies of North Africa and the other countries that are there.
Why is it important for Latin America to diversify its economies?
It is important for Latin America to diversify its economy because for one thing, L.A. (Latin America) wouldn't have to take the risks of a failed business by relying on one crop or resource. Another reason is that more diversed crops or resources brings in a steady amount of money with varied products, and L.A. would be taking their chances by just relying on one crop/resource. I hope I've been helpful! ^_^
Why are African nation trying to diversify their economy?
The African Nation is trying to diversify their economies because A country with a diverse economy will not be hurt as much if a major cash crop fails or if world prices for one of it's major mineral exports suddenly drops. THAT'S THE REAL ANSWER!!!!
Why did the Central American countries need to diversify their economies?
Brazil, Bolavia, Peru, Colombia
What are African countries doing in order to depend less on the sale of one export?
diversify their economies
Why are African countries diversify their economies?
African countries are finding that a diversified economy helps weather the highs and lows. It also helps in the case of crop failures from disease or bad weather.
What are the importance of rocks?
Rocks are very important to the economies of the countries where they are located. They are the source of many minerals and gemstones.
What is the most important countries in Europe?
The most important European countries are the UK, Germany, France, Russia, and Italy. This is based on economies, population, military power, and world influence.
Why are most economies referred to as mixed economies?
poverty is always higest in countries with market economies
Why are most economies refered to as mixed economies?
poverty is always higest in countries with market economies
Two countries with market based economies?
There are several countries that have a market based economies. France and England are two countries that have this type of economy.
Why are most modern economies referred as mixed economies?
poverty is always higest in countries with market economies
What are three important economies in Australia?
Three of the most important economies in Australia are:MiningAgricultureTourism
Why did European countries feel it was important to gain more land?
They where looking for new markets and raw materials to improve their economies.
What countries have open economies?
the UK
